Istanbul Stock Exchange

The Istanbul Stock Exchange, commonly abbreviated as ISE and known in Turkish as İstanbul Menkul Kıymetler Borsası (IMKB), was Turkey's principal organized securities market during the country's modern capital-market development. It was formally established in 1985 after a series of legal and institutional reforms intended to create a regulated national exchange. The exchange began operating as an autonomous professional organization in early 1986 and later moved to a purpose-built complex in İstinye, on the European side of Istanbul, in 1995. The ISE developed against a much older history of securities trading in Istanbul. An organized market for government securities appeared in the Ottoman period in 1866, and was formally reorganized in 1873 as the Dersaadet Securities Exchange. After the establishment of the Turkish Republic, a 1929 law created the Istanbul Securities and Foreign Exchange Bourse. These earlier institutions were affected by the Great Depression, the Second World War and changing economic conditions, but the expansion of Turkish joint-stock companies during the later industrialization period increased demand for a modern equity market. The institutional foundations of the modern ISE were laid in the early 1980s. Turkey enacted its Capital Market Law in 1981, established the Capital Markets Board in 1982, and issued measures in 1983 and 1984 governing the creation and operation of securities exchanges. The ISE was formally inaugurated at the end of 1985 and became the country's sole corporation dedicated to organized securities trading. Its market scope included equities, government bonds and bills, revenue-sharing certificates, private-sector bonds, foreign securities, real-estate certificates and certain international securities. Trading was conducted through member banks and brokerage houses. The exchange operated two regular weekday sessions, with a morning session from 09:30 to 12:30 and an afternoon session from 14:00 to 17:30 according to the historical operating arrangements described in reference material. It calculated and published price indices during trading and return indices at the close of the session. Its index family included broad-market, large-company, sectoral, second-market, new-economy and investment-trust measures. The ISE National-100 became the principal headline indicator and incorporated the companies represented in the National-50 and National-30 indices. By the period immediately before its replacement, the exchange was associated with approximately 320 national companies and had developed relationships with major international market organizations. It was a full member of bodies and initiatives including the World Federation of Exchanges, the Federation of Euro-Asian Stock Exchanges, the International Capital Market Association, the Federation of European Securities Exchanges and the Sustainable Stock Exchanges initiative. It was also an affiliate member of the International Organization of Securities Commissions. The ISE ceased to exist as a separate exchange entity on April 5, 2013. It was combined with the Istanbul Gold Exchange and the Derivatives Exchange of Turkey to create Borsa İstanbul, Turkey's consolidated exchange group. The successor organization absorbed the ISE's equity-market role and continued the development of Turkey's integrated securities, commodities and derivatives infrastructure. Consequently, the Istanbul Stock Exchange is best understood as a historical exchange brand and institutional predecessor rather than an active standalone marketplace.

Turkey's organized securities-market tradition predates the modern republic. A securities market was established in Istanbul in 1866 to help refinance Ottoman foreign debt issued after the Crimean War. It was formally renamed the Dersaadet Securities Exchange in 1873. Following the founding of the Turkish Republic, legislation enacted in 1929 reorganized the market as the Istanbul Securities and Foreign Exchange Bourse. The earlier market experienced interruptions and weakened activity during the Great Depression and the Second World War. Over subsequent decades, however, industrial development increased the number of Turkish joint-stock companies and encouraged the public distribution of company shares. By the early 1980s, the country needed a stronger legal and institutional framework for modern capital markets. The Capital Market Law was enacted in 1981, and the Capital Markets Board was established in 1982 as the principal supervisory and regulatory authority for securities markets. A decree in October 1983 provided for the establishment of securities exchanges, while regulations governing their organization and functions were published in October 1984. These measures led to the formal inauguration of the Istanbul Stock Exchange at the end of 1985. It began operating as an autonomous professional organization in early 1986. The ISE served as Turkey's principal and, for many years, only organized securities exchange. Its instruments included equities, government bonds and bills, revenue-sharing certificates, private-sector bonds, foreign securities, real-estate certificates and international securities. Banks and brokerage houses incorporated in Turkey could participate as exchange members. The exchange operated from İstinye on Istanbul's European side after moving to a modern complex on May 15, 1995. The ISE also built a market-information and index infrastructure. It published intraday price indices and calculated return indices at the close of trading. Its index series covered the overall national market, large-company groupings, sector and sub-sector categories, a second national market, a new-economy market and investment trusts. The National-100 was the principal broad-market indicator and included the National-50 and National-30 constituencies. Beyond trading, the institution participated in international exchange and capital-market networks. Reference material identifies its memberships in the World Federation of Exchanges, Federation of Euro-Asian Stock Exchanges, International Securities Services Association, International Capital Market Association, European Capital Markets Institute, World Economic Forum, Federation of European Securities Exchanges and the Sustainable Stock Exchanges initiative. It was also an affiliate member of IOSCO. The exchange's institutional life ended in 2013 as Turkey consolidated its market infrastructure. On April 5, 2013, the ISE was merged with the Istanbul Gold Exchange and the Derivatives Exchange of Turkey. The resulting Borsa Istanbul became the successor exchange entity, combining equity, precious-metals and derivatives-market functions. The ISE therefore remains historically important as the predecessor of Turkey's unified exchange, but it is no longer an active standalone organization.

• 2013

  ISE becomes part of Borsa Istanbul

  [1]Borsa Istanbulen.wikipedia.org

  On April 5, the ISE was combined with the Istanbul Gold Exchange and the Derivatives Exchange of Turkey to form Borsa Istanbul.

• 1995

  ISE moves to İstinye complex

  [1]Borsa Istanbulen.wikipedia.org

  The exchange moved to its modern building complex in Istanbul's İstinye district on May 15, 1995.

• 1986

  Exchange begins operations as an autonomous institution

  [1]Borsa Istanbulen.wikipedia.org

  The ISE began operating as an autonomous professional organization and became Turkey's central organized securities venue.

• 1985

  Istanbul Stock Exchange formally inaugurated

  [1]Borsa Istanbulen.wikipedia.org

  Following decrees and regulations issued in 1983 and 1984, the modern Istanbul Stock Exchange was formally inaugurated at the end of 1985.

• 1982

  Capital Markets Board established

  [1]Borsa Istanbulen.wikipedia.org

  Turkey established the Capital Markets Board as the main supervisory and regulatory body for the securities market.

• 1981

  Capital Market Law enacted

  [1]Borsa Istanbulen.wikipedia.org

  Turkey adopted legislation that provided the principal legal foundation for modern capital-market regulation.

• 1929

  Republic-era securities and foreign-exchange bourse created

  [1]Borsa Istanbulen.wikipedia.org

  A new law reorganized the securities market under the name Istanbul Securities and Foreign Exchange Bourse.

• 1873

  Market formally renamed the Dersaadet Securities Exchange

  [1]Borsa Istanbulen.wikipedia.org

  A formal reorganization gave the Ottoman securities market the name Dersaadet Securities Exchange.

• 1866

  An organized securities market is established in Istanbul

  [1]Borsa Istanbulen.wikipedia.org

  An early Istanbul securities market was created to support the refinancing of Ottoman foreign debt issued after the Crimean War.

Turkey's national organized securities exchange and central equity-market institution before the formation of Borsa Istanbul.

• Securities trading · 1986

  Equities

  The ISE's core activity was organized trading in shares of Turkish public companies. It provided a centralized venue for listed equities and supported the development of public ownership and capital raising by Turkish joint-stock companies.

• Fixed income · 1986

  Government bonds and bills

  The exchange supported trading in government bonds and bills, extending Istanbul's long-standing role as a market for sovereign securities and providing an organized mechanism for secondary-market transactions.

• Fixed income and structured securities · 1986

  Private-sector bonds and revenue-sharing certificates

  In addition to equities and government instruments, the ISE admitted private-sector bonds and revenue-sharing certificates, giving Turkish issuers and investors access to additional forms of marketable financing and investment.

• Market data · 1986

  ISE market indices

  The exchange calculated a family of indices covering the overall national market, the National-30 and National-50 groups, the broad National-100, sector and sub-sector markets, the Second National Market, the New Economy Market and investment trusts. The National-100 served as the principal headline indicator.

• 2013

  Consolidation into Borsa IstanbulM&A

  Background

  Turkey pursued a unified exchange structure bringing its principal securities, precious-metals and derivatives venues under one institutional umbrella.

  Action taken

  The Istanbul Stock Exchange was merged with the Istanbul Gold Exchange and the Derivatives Exchange of Turkey, with Borsa Istanbul beginning operations as the successor entity on April 5, 2013.

  Aftermath

  The ISE ceased to operate as a separate exchange brand, while its equity-market functions continued within Borsa Istanbul.

  Source

1. 1Borsa Istanbulen.wikipedia.org
2. 2Archived Istanbul Stock Exchange websiteise.org